Question

A company has two departments, Y and Z that incur delivery expenses. An analysis of the total delivery expense of $15,000 indicates that Dept. Y had a direct expense of $1,600 for deliveries and Dept. Z had no direct expense. The indirect expenses are $13,400. The analysis also indicates that 50% of regular delivery requests originate in Dept. Y and 50% originate in Dept. Z. Departmental delivery expenses for Dept. Y and Dept. Z, respectively, are:

Answer 1

Answer:Dept. Y and Dept. Z, respectively, are: $8,300 and $6,700

Explanation:

Given that

total delivery expense of  Y and Z=$15,000

and Y and Z both have  50% of regular delivery requests

Departments       Direct expenses       Indirect expenses

y                              $1,600                   $13,400 x 50% = $6,700

z                                     $0                   $13,400 x 50 % = $6,700

For department y = The total expenses =   direct expenses+indirect expenses $1,600 + $6,700 = $8,300

For department Z= The total expenses =   direct expenses+indirect expenses $0 + $6,700 = $6,700